Commercial Quiz
Questions: 16 · 10 minutes
1. A factory has unused capacity and is offered a one-off order that will not affect regular sales. Which comparison most directly shows whether the order adds short-run profit?
The order's revenue versus all historical factory costs
The order's incremental revenue versus its incremental costs
The offered price versus the company's usual list price
The customer's revenue versus the supplier's total revenue
2. Supplier A offers a lower unit price, but it has longer lead times, higher defect rates, and more expensive delivery than Supplier B. What should the buyer compare?
Only the suppliers' advertised unit prices
Only the number of products in each supplier's catalogue
The total cost of ownership, including quality, delivery, and operational effects
The suppliers' total company revenue, regardless of the contract
3. A product sells for $80 and has a direct cost of $50 per unit. What is its gross margin as a percentage of the selling price?
37.5%
30%
60%
62.5%
4. A profitable company is experiencing a cash squeeze because customers routinely pay invoices late. Which issue most directly explains the problem?
Cash is tied up in accounts receivable
Its brand awareness is increasing
Its depreciation expense is too low
Its gross margin is necessarily negative
5. What is a key commercial implication of a recurring-revenue business model?
Customer acquisition costs no longer matter
All contracted revenue is guaranteed to become profit
The business does not need to monitor customer satisfaction
Revenue can become more predictable, but retention and churn remain important
6. Which financial statement normally reports a company's cash, debt, assets, and liabilities at a specific date?
The income statement
The sales pipeline report
The balance sheet
The statement of cash flows
7. In a SWOT analysis, which example is an external factor?
A new regulation affecting every company in the industry
The company's experienced sales team
The company's outdated internal software
The company's available cash balance
8. A company has already spent $100,000 on a project. New evidence shows that its expected future costs exceed its expected future benefits. What is the commercially sound basis for the next decision?
Continue until the original spending has been recovered
Continue because stopping would turn the prior spending into a loss
Stop only if the project has generated no revenue at all
Ignore the sunk expenditure and compare future incremental costs with future benefits
9. Without reducing sales, what is the usual immediate cash effect of selling excess inventory and avoiding its replacement?
Cash tied up in working capital is released
Cash becomes more heavily tied up in working capital
Accounts receivable increase by the inventory's full value
Fixed costs automatically fall by the same amount
10. A business records $500,000 in sales revenue and $420,000 in total expenses for the same period. What is its profit before tax for that period?
$420,000
$80,000
$500,000
$920,000
11. One customer generates 45% of a supplier's annual revenue. What is the main commercial risk created by this concentration?
Every other customer automatically becomes unprofitable
Losing or reducing that account could materially damage revenue and cash flow
The supplier must have excessive inventory
The supplier can no longer calculate gross margin
12. Which calculation gives the unit sales needed to break even when a company sells one product?
Variable cost per unit divided by selling price
Revenue divided by total fixed costs
Fixed costs multiplied by contribution per unit
Fixed costs divided by contribution per unit
13. A company raises a product's price by 10%, and the number of units sold falls by 4%. Assuming nothing else changes, what happens to revenue?
It falls by approximately 14%
It rises by approximately 5.6%
It falls by approximately 6%
It remains unchanged
14. What is the main commercial purpose of customer segmentation?
To replace financial forecasting with customer research
To ensure every customer receives exactly the same proposition
To group customers by meaningful similarities so offers and resources can be better targeted
To classify customers only by the order in which they purchased
15. A subscription business wants a metric that compares the lifetime gross value of customers with the cost of acquiring them. Which metric is most suitable?
The average initial order value
The website conversion rate
The annual revenue growth rate
The lifetime value-to-customer acquisition cost ratio
16. A market has total annual sales of $10 million, and one company has annual sales of $1.5 million within that market. What is the company's market share by sales value?
6.7%
10%
15%
18.5%